Futures Market Making In Arcades

benjamin

Newbie
4 0
Could anyone please tell me how futures trading in the arcades work.From what I know these traders try to make or narrow the spread buying the bid and selling the offer by placing orders and waiting for someone to hit them on both sides.It sounds simple however I realise it must be more complicated than this, but many people on this site say it is easier than directional trading but if this is the case how come alot of people don't make it.How many times a day do these traders trade I've heard it can go into the thousands from some people and then others say you cannot market make on screens the same way as you could on the floor and part of your money is earnt from directional trading as it is not possible to earn just from the spreads, like you could on the floor.In addition to this with all these arcades opening trading the same way surley the individuals potential to earn money diminishes, before there were a fixed number of locals market making on the exchange floor now there are thousands of people market making all trying to earn a living and the number is rising all the time.Could someone please explain,It would be very much appreciated.
 

TWI

Senior member
2,527 252
It is about like you say, just buying the bid, selling the offer. Usually spreads either within one market or across 2 or 3 markets. Spreads are tight so you have to be quick.
Volumes of paper on futures exchanges also increasing rapidly as electronic platforms allow more investors of all sorts in. Still money to go round but you have to be a bit sharper.
Quite a lot already said about this on these boards, do a search under arcade.
 
 
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